HAUPPAUGE, NY-A 13-building Suffolk County office portfolio, including the four-building, 215,000-square-foot Crossroads Corporate Center here, has traded to Matrix Realty Corp. The sellers, a joint venture between CenterSquare Investment Management Holdings Inc. and Ivy Realty, did not disclose the price; a source familiar with the transaction puts it at $39 million, or about $97 per square foot, comparable to other recent office sales in the region.
CenterSquare and Ivy bought Crossroads Corporate Center and the 185,000-square-foot, nine-building Crossroads Executive Center a mile away in Islandia, from developer Heatherwood Communities in 2004 for a reported $41 million. Ivy hired Colliers International to market both office parks as a package this past March, according to Real Estate Alert.
A Colliers team including Douglas Sayer of the Philadelphia office, Mark DeRiemer in New York City and the Long Island office’s Ken Enos, Herb Agin and Steven D’Orazio, arranged the sale. Agin cites the improving office market on Long Island in attracting investor interest.
The main driver, Agins tells GlobeSt.com, is “the three large hospitals”: North Shore-LIJ Health System, Winthrop University Hospital and Stony Brook University Medical Center. “Their evolution is a response to the new reality of medical care, which requires additional space in a combination of medical offices, new programs and administration. Since the turnaround began in 2010, steady growth in sectors such as law, accounting and financial services by local small- to mid-size companies have also accounted for increased absorption.”
Given the makeup of Long Island’s office tenancy—it’s home to a small number of Fortune 500 companies—“we seem to be less affected by their slow job growth,” says Agin. An equally important factor, he adds, is that “as a mature suburban market, the opportunity to develop new projects is limited and the cost is prohibitive. Therefore, existing properties in good locations that have been well maintained and/or refurbished by ownership are in high demand.”